You know I ‘ve been calling a long-term bullish reversal since $1,045. You also have to read my analysis back then for Direxion Daily Gold Miners Bull 3X Shares (NYSE:NUGT) that could reach 100$. Since then gold has made several big swings and NUGT also a remarkable pull back correction.
I’m long NUGT and I believe it can make new highs as I expect gold to move above the long-term trend line resistance.
My preferred wave count is a nested 1-2-(1)-(2) waves. The recent pull back has not managed to push lower and the 38% Fibonacci retracement and price continues to trade above the black trend line support. $1,300 I believe is the key here. As long as we are above it this scenario is my preferred one. If we break below it then the critical support for this wave count will be the $1,266 level.
A break below the black trend line will also open the way for a deeper correction towards $1,200-$1,180 but again this will be a buy opportunity according to my analysis as the long-term trend has already changed and we are just making the first pull back.
NUGT is testing weekly cloud support. This is also the 61.8% Fibonacci retracement of the rise from its lows.
My vehicle for my bullish view on gold is NUGT and I believe it can explode to the upside if gold reverses to the upside as I expect it to do from current levels. The next upward move in gold will give new highs above $1,400.
If this does not happen, I will close and wait to buy gold below $1,270 and as close to $1,200 as possible. I remain long-term bullish gold.
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